Adani’s $1.2 B Copper Smelter Faces Challenges Amid Ore Shortage
Adani Enterprises Ltd’s $1.2 billion smelter in Gujarat, India, is struggling to ramp up full operations due to a shortage of copper concentrates caused by tight global supplies. The facility, formally known as Kutch Copper Ltd, has a stated annual capacity of 500,000 metric tons and aims to double that by 2028-29, but feedstock constraints are delaying the scale-up.
Supply Agreements and Strategic Goals
The smelter has already secured supply agreements with major producers, including an arrangement with Chile’s Codelco to deliver concentrates this year. However, delays and competition for concentrate supplies mean the plant has so far imported only a fraction of what is needed to run at full capacity. The project aims to reduce India’s dependence on refined copper imports, which were valued at around US$2.8 billion in the prior year.
Industry Context and Market Risks
The global copper smelting industry is facing tight margins and fierce competition for available ore as new smelters come online worldwide and China expands its capacity aggressively. For Kutch Copper, this means higher input costs and potential delays in reaching optimal production. The mismatch between concentrate supply and smelter demand is forecast to intensify in coming years.
